After a poor price performance in 2017, prices declined by 4.7% versus a gain by the LME index of 28.5%, we think prices will catch-up in 2018. Prices have recovered from lows in mid-December around $18,800 per tonne to more than $20,300 per tonne a month later. A tightness on the LME with stocks of available metal nearing the November 2016 low of 1,125 tonnes has helped the recovery. In Indonesia, several smelters have scheduled shutdowns and administrative disruptions related to export permit renewals slowing shipments in the short-term. An extension of the export paperwork bottleneck could impact the physical market and accentuate upward pressure on prices via an increase in net long speculative positions. We remain constructive toward tin for the first quarter, forecasting a Q1 2018 cash price average of $20,500 per tonne. Tin is likely to challenge $21,000 per tonne by the end of the first quarter, while a breach of $22,000 per tonne would be very bullish from a technical point of view.
Analysis by Andy Cole, base metals analyst and editor of MBRs Base
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